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Stocks May See Further Upside In Early Trading - U.S. Commentary

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Stocks are likely to move to the upside in early trading on Tuesday, extending the upward move seen over the two previous sessions. The major index futures are currently pointing to a higher open for the markets, with the Dow futures up by 203 points.

Optimism about trade talks between the U.S. and China may continue to generate buying interest on Wall Street amid a second day of meetings between U.S. and Chinese officials.

The second day of negotiations coincided with an unannounced visit by North Korean leader Kim Jong Un, with some analysts saying China could use Kim's visit as a bargaining chip in the trade talks.

In a post on Twitter this morning, President Donald Trump claimed, "Talks with China are going very well!"

Traders remain skeptical about the potential for a long-term trade deal, however, potentially keeping buying interest somewhat subdued.

A relatively quiet day on the U.S. economic front may also keep some traders on the sidelines amid the ongoing government shutdown.

Later tonight, Trump is scheduled to deliver a national address on what his administration has described as a "crisis" on the southern border.

Trump has made numerous attempts to draw public attention to problems caused by illegal immigrants amid an impasse over funding for his controversial border wall.

The president has recently suggested he could go around Congress and obtain funding for the wall by declaring the situation on the border a national emergency.

Following the substantial rally seen last Friday, stocks saw some further upside over the course of the trading session on Monday. With the upward move, the major averages continued to offset the sell-off seen last month.

The major averages pulled back off their best levels in afternoon trading but remained firmly positive. The Dow rose 98.19 points or 0.4 percent to 23,531.35, the Nasdaq surged up 84.61 points or 1.3 percent to 6,823.57 and the S&P 500 climbed 17.75 points or 1.7 percent to 2,549.69.

In overseas trading, stock markets across the Asia-Pacific region turned in a mixed performance during trading on Tuesday. Japan's Nikkei 225 Index advanced by 0.8 percent, while China's Shanghai Composite Index fell by 0.3 percent.

Meanwhile, the major European markets have all moved to the upside on the day. While the French CAC 40 Index has jumped by 1.6 percent, the German DAX Index and the U.K.'s FTSE 100 Index are up by 1.2 percent and 1.1 percent, respectively.

In commodities trading, crude oil futures are advancing $0.77 to $49.29 barrel after climbing $0.56 to $48.52 a barrel on Monday. Meanwhile, after rising $4.10 to $1,289.90 ounce in the previous session, gold futures are falling $7.70 to $1,282.20 an ounce.

On the currency front, the U.S. dollar is trading at 108.81 yen compared to the 108.72 yen it fetched at the close of New York trading on Monday. Against the euro, the dollar is valued at $1.1439 compared to yesterday's $1.1474.

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